Following the Dark Money: Bloomberg to NYU to Virginia’s OAG?

Mark Herring (far right) at 2016 launch of AGs United for Clean Power Plan.

Here is a counter-factual mental exercise for you. Imagine that former Attorney General Ken Cuccinelli, a conservative skeptic of climate change, had applied for a grant from the conservative-libertarian Koch Foundation to cover the cost of hiring an AG staff member dedicated to litigating environmental groups. Then imagine that Cuccinelli’s office had to compete nationally with other AG offices around the country for the grant, that the Koch Foundation would fund only those projects that best advanced its anti-climate change agenda, and, if approved, that the Koch Foundation would help select the attorney.

Would that have been a news story? Would the Washington Post and every other Virginia newspaper have given it front-page scandal coverage? Would Democrats and environmental groups decry the use of private dollars to hire lawyers to wield the legal powers of the AG’s office to harass and intimidate Koch brothers enemies?

Now flip the scenario. In the real world, Attorney General Mark Herring’s office submitted an application on Sept. 15, 2017, to the New York University School of Law’s State Energy & Environmental Impact Center for funding to hire a NYU School of Law fellow “as a Special Assistant Attorney General” devoted to climate-change issues. The Virginia AG’s office, stated the application, “would work with the State Impact Center to identify, recruit and extend offers to appropriate candidates.” The Center is backed by billionaire, former New York Mayor, and anti-global warming champion Michael Bloomberg.

The State Impact Center announced in a December 2017 press release that Virginia would be hiring a special prosecutor. However, Michael Kelly, director of communication for the AG’s office, told Bacon’s Rebellion: “No such funding was received and no such attorney is employed here.”

Herring has a history of activism on climate change. In 2016 he joined a group spearheaded by then-New York AG Eric T. Schneiderman that included AGs from 16 states and the Virgin Islands to combat global warming. Participants committed to work together on initiatives such as “ongoing and potential investigations into whether fossil fuel companies misled investors and the public on the impact of climate change on their businesses.”

“As a Commonwealth and as a nation, we can’t just put our heads in the sand because we are already confronting the realities of climate change,” said Herring in a statement included with the official announcement. “I’m proud to have Virginia included in this first-of-its-kind coalition, which recognizes the reality and the pressing threat of manmade climate change and sea level rise. I’m looking forward to working with my colleagues to explore opportunities to address climate change, encourage the growth of our clean energy sectors, and build a cleaner, more sustainable future.”

The Schneiderman initiative disbanded a few months later when confronted with open records law requests and negative media attention. Last year Schneiderman resigned from office amidst allegations of multiple abusive sexual relationships. But AG activism continues, funded in part by Bloomberg through NYU’s State Energy and Environmental Impact Center.

Law enforcement for rent. Chris Horner, a Virginia resident and senior fellow at the right-of-center Competitive Enterprise Institute (CEI), has documented how wealthy environmentalists like Bloomberg have bankrolled climate-change activism by state attorneys generals. In his August 2018 report, “Law Enforcement for Rent: How Special Interests Fund Climate Policy through State Attorneys General,” he chronicles how activists began seeking a sympathetic attorney general as early as 2012 to subpoena their opponents’ records. Wrote Horner:

Public records reveal the anatomy of what began as an “informal coalition” of AGs to use the legal system in pursuit of an overtly political agenda in coordination with activists and plaintiffs’ lawyers. That coalition disbanded under open records and media scrutiny, but it has now reconstituted through a program by which donors fund, privately hire, and place investigators and prosecutors in AG offices. It uses a nonprofit organization to pass the funding through and to provide the OAGs with a network of “pro bono” attorneys and public relations services. In return, OAGs provide office space to the privately hired prosecutors; agree they are there to “advance[e] progressive clean energy, climate change, and environmental legal positions”; and provide regular reports about their work.

Led and funded by former New York Mayor Michael Bloomberg, this scheme hires “Research Fellows,” which it then places as “Special Assistant Attorneys General.” …

“[The modus operandi] uses nonprofit organizations as pass-through entities by which donors can support elected officials to, in turn, use their offices to advance a specific set of policies favored by said donors. It also uses resources that legislatures will not provide and that donors cannot legally provide directly. The budget for climate policy work alone is in the tens of millions of dollars per year.

Horner argues that the hiring of privately funded A prosecutors sets “a dangerous precedent” in which “private interests [commandeer] the state’s police powers to target opponents of their policy agenda and hijack the justice system.”

Horner pieced together this invisible funding network by means of extensive Freedom of Information Act requests with multiple AG offices, including Virginia’s.

A key individual in the Bloomberg operation is David J. Hayes, a former Clinton- and Obama-administration official who serves as executive director of the NYU State Energy & Environmental Impact Center. The mission of the center, according to its website, is to support “state attorneys general in defending and promoting clean energy, climate and environmental laws and policies.” Among the specific activities it lists is “working with interested attorneys general to identify and hire NYU Law Fellows who serve as special assistant attorneys general in state attorney general offices, focusing on clean energy, climate and environmental matters.”

Horner’s report does not document the basis for his claim that the NYU initiative is funded by Bloomberg. However, Bloomberg’s backing of anti-Global Warming causes has been widely reported. In 2011, for instance, he donated $50 million to the Sierra Club’s “Beyond Coal” initiative that targets coal-powered generating plants for shutdown. Bloomberg Philanthropies’ most recent 990 public disclosure form, covering 2016, does not list the State Energy & Environmental Impact Center as a grant recipient, but the Center did not become active until late 2017. Daniel Firgir, a member of the Environment Program at Bloomberg Philanthropies, does serve on the State Energy and Environmental Impact Center’s advisory council.

A special assistant attorney for Virginia. The Virginia Office of Attorney General (OAG) engaged with the State Energy & Environmental Impact Center early in the game. On Sept. 27, 2017, Hayes went public with the Center’s first press release, which described plans to “support Attorneys General on legal and communications strategies.”

Hayes had been laying the groundwork for the initiative before issuing the press release. Indeed, one of the state AG officials with whom he had been communicating was Donald D. Anderson, senior assistant attorney general and chief of the Virginia OAG’s environmental section. Two days previously, on Sept. 25, 2017, Anderson had emailed Hayes with an application to hire a special assistant attorney. “We appreciate the opportunity to participate in this program,” he wrote.

In the application Anderson said that Herring had long been committed “to the interests that form the core mission of the State Impact Center — clean energy, climate change more more generally environmental matters.” He cited Herring’s work on the Environmental Protection Agency’s Clean Power Plan, his joining other state AGs in opposition to President Trump’s withdrawal from the Paris Climate Agreement, and his support for Governor Terry McAuliffe’s executive actions to reduce carbon pollution in Virginia.

“The OAG has achieved this track record of commitment to regional and national environmental issues with limited resources,” Anderson wrote. The environmental section is staffed with six full-time line attorneys, two part-time attorneys, and one paralegal. They have a wide range of responsibilities working with numerous state agencies and engaging in litigation on issues such as uranium mining. “The addition of an NYU Fellow would provide a full-time attorney to allow General Herring to participate much more fully in cooperative efforts to advance the agenda represented by the State Impact Center.”

Anderson said the OAG’s office paid $70,000 to $100,000 yearly to attorneys with three to 20 years of experience. He anticipated an appropriate salary for the NYU fellow be approximately $81,500. “We understand that, if selected for the program, our Office would work with the State Impact Center to identify, recruit and extend offers to appropriate candidates,” he wrote.

The Virginia OAG has historically employed, and currently employs, fellows funded by law schools, added Anderson. Although the arrangement with the State Impact Program “would be somewhat different,” Anderson said, he knew of no “Virginia specific limitations or requirements” that would stand in the way of the hiring.  “We have … reviewed the Virginia Rules of Professional Conduct and find no concern about the proposed arrangement, which we understand require that the attorney’s duty of loyalty shall be to the Attorney General and the Commonwealth and its agencies.”

On Dec. 13, 2017, the Center announced that Virginia was one of three second-round grantees. “Three additional attorney general offices will be hiring special assistant attorneys general to work on clean energy, climate and environmental matters of national and regional importance, stated the press release. The three included Oregon, Pennsylvania, and Virginia, bringing the total number of AGs offices under the program to ten.

“Climate change is a real and urgent threat to the health, safety, and economy of Virginia communities from the coast to the mountains, and everywhere in between,” the press release quoted Herring as saying. “The work the State Impact Center is doing to protect our environment and promote clean energy is so important, and I’m glad Virginia is participating in its fellowship program. I look forward to the opportunities this partnership will provide to address climate change and protect our environment for future generations.”

According to Horner, Hayes followed up on the grant by emailing Anderson on Jan. 24, 2018: “Liz,” wrote Hayes, presumably referring to his deputy Elizabeth Klein, “and I would appreciate the chance to come down to Richmond and visit with AG Herring and the team to discuss how we can work together. I’ve had similar meetings with the other AGs that are bringing on Special Assistant AGs, and other AGs who we are working with.”

In a February 2018 press release, Hayes credited states attorney generals with “at least 80 actions to advance and defend progressive clean energy, climate and environmental laws and policies” over the previous year. An online “hub” noted 25 actions undertaken by Herring. These included many actions not directly pertaining to areas of responsibility normally associated with the Virginia AG’s office.

For instance, on Feb. 28, 2017, Herring urged Rep. Lamar Smith, R-Texas, to end “congressional interference” with the subpoenas by the New York and Massachusetts AG offices issued to ExxonMobil Corp.’s regarding its stance on climate change. On June 26, 2017, Herring joined a national “We Are Still In” pledge To maintain commitments to the Paris Climate Agreement. On Dec. 20, 2017, Herring joined other AGs in sending a letter to congressional leaders opposing cuts in the Environmental Protection Agency budget. The letters cited consistently included the ten AG offices that received State Impact Center money.

Did Herring get the money or didn’t he? The State Impact Center December 2017 press release made it clear that Virginia “will be hiring” an assistant attorney general to work on “clean energy, climate and environmental matters of national and regional importance.” Herring signaled that he signed off on the press release by contributing a quote for it.

However, Herring’s office never issued a press release acknowledging the grant. Did the OAG receive the money? Did it hire a NYU law school fellow?

I wrote Michael K. Kelly, director of communication for the OAG, asking: “On Sept. 15, Senior Assistant Attorney General Don Anderson submitted an application to New York University’s State Energy & Environmental Center to hire ‘a Special Assistant Attorney General’ focused on climate-change and clean-energy issues.”

Kelly replied: “Hi Jim—No such funding was received and no such attorney is employed here.”

I followed up by asking in two emails, “Does the AG’s office intend to re-apply in the hope of securing funding in the future?”

Kelly did not reply to either email.

Did the OAG have a change of heart regarding the propriety of taking private money to fund a new position? An argument can be made that while the OAG is free to accept outside money, it has no authority to spend it — unless such funds are allocated by the General Assembly.

Whatever the case, Herring announced last month that he would no longer accept campaign contributions from state-regulated monopolies. As he told the Blue Virginia blog, as reported by the Richmond Times-Dispatch, the AG also said he would take no money from lobbyists or senior executives of state-regulated monopolies. By contrast, he has accepted $175,000 from Charlottesville millionaire Michael Bills, founder of Clean Virginia, who has offered financial support for any candidate spurning money from Dominion Energy.

The Times-Dispatch article did not raise the issue of the AG’s office accepting money from private sources.

Update: Chris Horner has provided a copy of a memo from Chris Moyer, communications director of the State Impact Center to Michael Kelly, communications director for the OAG. The memo both documents Horner’s contention that Bloomberg was a major funder of the Center and illustrates, as of November 2017, the Center’s expectation of collaborating with Herring’s office in the communications/public relations arena. View memo.

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17 responses to “Following the Dark Money: Bloomberg to NYU to Virginia’s OAG?”

  1. Steve Haner Avatar
    Steve Haner

    There used to be language in the state budget restricting the acceptance of outside money by OAG. Not in a position today to see if it is still there. I think it would take approval of the Governor and DPB to accept $$ and create a new position. Somebody should be asking more questions, and the right ones since it is easy to dodge the wrong questions.

  2. LarrytheG Avatar

    It’s a pretty dishonest narrative IMHO. These candidates are coming from the NYU School of Law…. not exactly “private” money. Oh.. but because Bloomberg donates to them – it means they are a leftist private money outfit!

    This is how the right works these days. If you actually go read the article to find the names of these “groups” who have given money to the AGs to hire activists.. there are none… the only group identified is the Union of Concerned Scientists who “communicated” with the AGs….

    This borders on propaganda and disinformation which is becoming standard fare with CEI and others like them…

  3. From a distant view, I’d call this a dark money draw: we know that conservative funders funnel money to influence policy, and we know that liberal funders funnel money to influence policy. But LarrytheG, there is nothing public about NYU School of Law, it is private money funded by Bloomberg et al. Does this make the agenda peddling more or less troubling?

  4. The difference between the Koch Brothers and Bloomberg is that there are well-funded groups and a collaborative media aimed at exposing Koch brothers activities. There is no comparably well-funded apparatus — and virtually no media whatsoever — dedicated to exposing the activities of leftist funders.

    The way to understand Larry’s comments is very simple: does a given post advance or hinder the narrative of the Left? If a post undercuts a leftist narrative, he’ll come up with some kind of rationalization for ignoring it.

    1. Reed Fawell 3rd Avatar
      Reed Fawell 3rd

      This particular structure strikes me a troublesome. The key here is that it turns our system of governance upside down. The state becomes a grantee of a private interest group with a strong agenda who in essence can be said the hire state machinery to achieve its own goals. The state gets money and manpower to serve the goals of a private party, and perhaps arguably the interests of individuals within the state government or a particular administration. Such joiner of private and state action is a path that can be fraught with risks. I suspect many would not consider it a good practice of democratic governance.

  5. djrippert Avatar

    I can draw a clear bright line between Dominion’s contributions and Dominion’s influence in the General Assembly. Another clear bright line can be drawn between Dominion’s influence in the General Assembly and Dominion’s revenues, profits, stock price and the salaries and bonuses of Dominion executives.

    I see no such clear bright line between some millionaire environmentalist in Charlottesville and his political influence inflating his personal net worth. In fact, I find it hard to even imagine how such a line could be drawn. Even if he were investing in solar panel manufacturing there isn’t enough demand in Virginia to materially move the stock price of such a company. Somebody is going to have to present at least a theoretical case for how a millionaire or billionaire could inflate their net worth through environmentally focused donations. And please spare me the Al Gore references. The man who liberals desperately wanted to be president in 2000 is a greedy self promoter who trades on his notoriety to line his pockets. Michael Bills doesn’t have any notoriety to trade upon. Tell me how you turn money into more money by giving away money to environmentally aware politicians. And even if you can posit such a scheme I’ll wager that I can present 10 better ways to turn a small fortune into a larger fortune.

    1. Few liberal millionaires and billionaires who donate to environmental causes are looking to increase their net worth. There may be a few, but I have no doubt that most are sincere about wanting to save the world and are motivated by altruistic impulses.

      But so what? The fact is that these guys use their money to influence public policy in conformity with their values, their priorities, and their understanding of how the world works, and the process by which they do is opaque. We can see what Tom Farrell and Dominion are up to. We don’t see how Michael Bloomberg directly or indirectly influences policy here in Virginia.

      1. djrippert Avatar

        Fair enough. Silly rich people certainly can use their wealth for silly rich people reasons.

        I would contend that your belief that “we can see what Tom Farrell and Dominion are up to” is a stretch at best. Take a look at Dick Saslaw’s finances. Money pours from the usual suspects to a politician who hasn’t faced a serious opponent in decades. Then, Saslaw for Senate makes donations to various funds – for example … $2,876,211 to the Virginia State Democratic Caucus (over the years). The Virginia State Senate Democratic Caucus donated $15,514,836 over the years including cumulative donations of $9,189,020 to the Democratic Party of Virginia. The Democratic Party of Virginia donated $444,442 to Herring for Senate (over the years).

        So, did Dominion donate to Herring? Of course. But the political money laundering that goes on in Virginia makes tracing the amounts impossible. All of which makes Herring’s disingenuous promise not to take money from state regulated companies complete BS. Unless he forgoes any source which (at some point in the transfer cycle) took any money from Dominion.

        I’m getting the distinct impression that we presently have a Jimmy Carter imitator as governor and the reincarnation of Richard Nixon as Attorney General.

  6. LarrytheG Avatar

    re: ” Following the Dark Money: Bloomberg to NYU to Virginia’s OAG?”

    this is laughable… guys.. if it were “dark” how do you know who’s giving it?
    besides that he’s no different than a LOT of folks who donate to colleges who then use that money for various activities but NONE of which is to funnel that money to politicians! Talk about conflation!

    And if you REALLY want to know about ‘dark money” – go find out who is actually funding the CEI and Mr Horner. Where does CEI gets it’s funding to pay Mr. Horner and others who work at CEI and publish their dubious “reports”? Start with Donor’s Trust…. who has ties to the CEI.

    It goes like this. Conservative donors don’t give direct to their favorite organization, instead they give to Donors Trust and designate who is to receive the money and then Donors Trust give it to various right-wing think tanks who then attack those who work for consumers and environmental regulations – it’s not just environmental… it’s regulations .across the board…

    CEI was among the larger defenders of the Cigarette companies, opposed to tobacco settlement and filed lawsuits against the GOvt as well as the states AGs asserting that the settlement was “illegal”. Who funded them?

    some simple GOOGLE searches on CEI and their role in supporting tobacco companies and now fossil fuel companies is easy to find.. and verify.

    And again – ask yourself who is funding them? do you know?

    The difference between CEI and folks like Michael Bills is that Bills is not laundering his money through a Donor’s Trust type organization. Most Conservative think tanks try to essentially launder their funding sources.

    We KNOW who Bills is and we KNOW who he is giving money to.

    who is funding CEI? Who is funding ALEC and Heritage, etc?

    at LEAST try to be honest about what DARK money REALLY IS!


  7. Dick Hall-Sizemore Avatar
    Dick Hall-Sizemore

    Jim’s “mental exercise” of asking, “Would I be upset by this behavior if the tables were turned and the other side was doing this?” is a good practice to follow. It helps to make one consistent.
    I have long been troubled by the AG (from either party) using the office to promote policies. The AG should be the law firm of the state, period. Its role should be to provide legal advice to agencies, defend agencies in case of litigation, and defend state law and the state when challenged in court. By allowing AGs to use their elected position as a platform and their office to provide resources for the promotion of, or attacking of, policies is dangerous. We can see the result of this trend: Republican AGs were active attacking various federal policies in the Obama administration (Obamacare, environmental regulations, etc.) and now Democratic AGs are using that playbook.

    1. LarrytheG Avatar

      I think what you and others, me “think” the AGs office “should be” in not in concert with the facts and realities.

      It’s an elective office that is contested by partisan candidates and both sides have a long history of conducting that office according to their party philosophies.

      We actually can CHOOSE to change that via our legislative process and that would likely require both bi-partisan compromise and I suspect a Constitutional Amendment.

      Just as we could also CHOOSE to outlaw the kind of money influence we have and computer-drawn voting districts.

      But with regard to a non-partisan AG, I’m not sure if any of the other states actually operate that way in no small part because the sheer number of them that now engage in lawsuits over partisan issues like abortion, environmental regulation and healthcare.

      The very first step here is for folks to acknowledge the reality of the partisan nature of the office and stop claiming one side is engaging in partisan actions while implying their side does not.

      This whole blog post is misleading in that respect. On both sides, there are a wide variety of actions and activities that they pursue on a partisan basis. It’s not “news” except when promoted by think tanks as “exposes” to the uninformed and gullible and those that then re-publish them are essentially doing the same.

  8. Dick Hall-Sizemore Avatar
    Dick Hall-Sizemore

    By the way, Steve, that budget language you were remembering is still there. It establishes a procedure for disbursing any revenue received by the AG through a forfeiture settlement in federal litigation. It was put in there in reaction to the Cooch getting a large court settlement and then spreading the money around through grants to various public safety agencies.
    There does not seem to be a limitation on the AG getting the sort of grant that has been talked about in this discussion. As long as there is sufficient nongeneral fund appropriation in the budget, he could spend the money. If the agency does not have sufficient appropriation, DPB can administratively increase the agency’s NGF appropriation. That is common practice for grants received by agencies in the middle of fiscal year.

    1. LarrytheG Avatar

      My understanding is that money always goes directly to the State first – that the agency cannot accept it directly. The State via the legislative process then can APPROPRIATE that money for the agency to spend AND that appropriation can have restrictions. The actual budget works that way also. An agency can submit a budget that is approved – but the actual money does not flow until it is appropriated.

      Some spending can be Mandatory – the budget and the appropriation are together.

      How wrong am I?

  9. LarrytheG Avatar

    The AG in any state is NOT a neutral player in the law in those states when it comes to political philosophy left and right.

    For instance, a Conservative AG will be a lot more friendly on the regulation front than a Liberal AG. When it comes to things like abortion or right-to-work or dozens of issues like that – the AG who is elected WILL BE either a Dem or a GOP and how they conduct that office IS political.

    It is a mistake to think that it is a part of the “administration” of the State. Nothing could be further from the truth!

    The lie is when someone claims that it “should” be a “neutral” participant in the law and regulation.

    Look at just how many State AGs joined in a lawsuit to overturn ObamaCare or to challenge Abortion!

    Does anyone think – those AGs did not hire people specifically to help support those court actions?

    You can argue that it’s not right for the AGs to do that – true – but to argue that only the Dems do that is just plain laughable… Both sides do it – and it’s normal and legitimate… unless and until we change the rules that say it’s not.

    Until then – “hit” pieces about what the Dem AGs are doing as if they should not and the GOP does not – is just plain ludicrous.

  10. Chris Horner provided me with a copy of email correspondence from Chris Moyer, communications director of the State Impact Center to Michael Kelly, communications director for the OAG.

    This documents Horner’s contention that Bloomberg was (and is) a major funder of the Center. It also illustrates, as of November 2017, the Center’s expectation of collaborating with Herring’s office in the communications/public relations arena.

    1. Reed Fawell 3rd Avatar
      Reed Fawell 3rd

      The e-mail raised red flags. Even the name of its sender suggests trouble. “State Energy & Environmental Impact Center.” There is no STATE actor here at all.

      And how about the Word “IMPACT CENTER.” Whose state does does this Center intend to IMPACT. I thought Mr. Boomberg was out of public office. Does he now through this Center he funds intend to buy the offices and public machinery of other states?

      This gets us back to an elaborated version of an earlier comment:

      This particular structure strikes me a troublesome. The key here is that it turns our system of democratic governance upside down. The state becomes a grantee of a private interest group with a strong agenda who in essence can be said to want to hire the machinery of someone else’s state to achieve its own goals. The state gets money and manpower from that private party to serve the goals of that private party, and perhaps serve the particular interests of individuals within the state government or a particular administration. Such alliances of private and state action designed to hijack machinery within a state government or commonwealth, and infiltrate that machinery with its own people, is a path that can be fraught with risks.

      How can these sorts of alliance be a good practice of democratic governance?

      Is the machinery of government here put up for sale, and sold, and infiltrated in order to promote private interests, and political agendas and ambitions of public officials, in lieu of allowing state machinery to serve the peoples’ legitimate public interests duly arrived at by the democratic process?

  11. […] to a request for comment Saturday, but despite being awarded the funding, his office told the blog Bacon’s Rebellion last month that despite receiving the grant, “No such funding was received and no such attorney […]

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